02. Financial protection needs

Question 1

Name the 5 main areas of need for protection.

Answer 1

• health, incapacity or accident
• income, mortgage & other debt
• death
• asset protection
• business protection

Question 2

Divorce, a dissolving of a CP or relationship breakdown should prompt what?

Answer 2

A review of protection needs as they may have changed, i.e. some protection may no longer be necessary.

Question 3

What 2 things must an adviser take into account when calculating the amount of protection a client needs, and why?

Answer 3

• if eligible for any state benefits
• any employer benefits
• to avoid duplicating any cover

Question 4

Name 2 advantages to the employee of employer-provided benefits.

Answer 4

• EER usually covers cost or if not, EEE will benefit from bulk buy discounts
• EEE will normally benefit from ‘free cover’

Question 5

Under employer benefits, what is ‘free cover’?

Answer 5

The amount of insured benefit allowed without medical underwriting.

Question 6

Name 2 disadvantages to the employee of employer-provided benefits.

Answer 6

• benefits will cease if EEE leaves
• EER may withdraw or reduce benefits